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Jim,
When you said that cylinders 3 and 5 had issues with exhaust, do you mean that during the leakdown test in those cylinders, you heard air escaping through the exhaust system?
If so, it's possible, I suppose, that those valves could be adjusted "too tight," but that seems somewhat unlikely. They'd have to be so far off that they weren't closing completely, which is pretty extreme. But if that were the case, then they could be damaged from having run in that condition -- that's one way that the edges of valves get burned. Let's hope that isn't what happened.
Do you have any leakdown or compression numbers from right after your rebuild as a baseline to compare with these latest numbers?
What I have seen on these engines is that dirt can get between the valve and seat surface that may prevent it from sealing.
What I'd do is pull the valve covers, check the valve adjustment, and then re-do the leakdown. Do you have the equipment to do it yourself? The tester only costs $100 or so, but you need a compressed air source. If you still have low numbers on those cylinders, then try this: with the leakdown gauge attached and the cylinder at TDC, take a block of wood and a hammer and use it to tap on the valve stem (by putting the wood on the rocker arm adjusting foot). As you tap, you'll see the leakdown needle drop and then rise again. If it consistently rises to the same number each time, then there's probably no dirt (carbon or whatever) under in the valve seat. That would mean that either there truly is a problem at that valve, or maybe, there's a problem somewhere else that's unaffected by your test. If the number rises or changes as you tap, then that would be an indication that you're moving something around in the valve seat (like dirt). You might even "fix" it with this technique! I've seen engines that have sat for a long time that have shown very low leakdown numbers at the valve seat. After tapping the valve in this way, the leakdown numbers came right up to spec, which indicated there was nothing fundamentally wrong with the engine
I think leakdown testing can be pretty flaky, so at a minimum I'd certainly adjust the valves, run the engine, and do the test again, to confirm that there's an issue.
Good luck.
Rob
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